Friday, February 06, 2015

Market Mantra
Nifty which opened at 8696.85 recovered during the day and touched 8726.20 intra-day. However, selling again started which dragged it down. Nifty is now trading at 8697.20 down marginally by 14.50 points. The Nifty is expected to trade in a narrow range in absense of any major clues, till the budget. 
However, there are high chances of seeing a recovery in the broader market at the end of the day, as there is lot of value in many of the beaten down mid and small-cap counters. The investors are suggested to look into Bank and Real Estate sectors, because the RBI has given a clear indication as where the interest rates are going, in future.
Today's Call: Buy UCO Bank Ltd at Rs.70.50, for a short term target of Rs.75. Keep a SL of Rs.66, for any short term trade. The came out with satisfactory set of numbers for the Q3FY15.
India Ratings (Ind-Ra) expects a sharp increase in demand for Tier 1 capital from 2015 towards the Basel III - the new capital norms for banks, a sector report released by the ratings firm said. It estimates a capital requirement of Rs.5,30,000 crore till FY'19 for all banks "Capital will be the key differentiator in 2015.". Midsized PSBs would be under pressure to consolidate their growth and focus on profitability. It further said, "Government's commitment towards their equity requirement would be a key rating driver." The Ind-Ra expects the GOI, to pump in Rs. 20,000 crore equity capital support for Public sector banks.
Today, the Premium (Paid) members were asked to the blue chip real estate firm, Unitech Ltd (Rs.16.95) at around Rs.16.70. The stock then moved to Rs.17.30. Unitech Ltd is a big name in the real estate space. Now when the RBI has given a clear direction as to, where the interest rates are going, one should buy such stocks and keep holding. 
Yesterday, Rohit Ferro Tech Ltd (Rs.8.70) moved up to above Rs.9.50, today it is another steel counter, Bhusan Steel Ltd (Rs.93). It is now a foregone conclusion that the government is bringing in a slew of measures to safeguard the  domestic steel sector. Hence, the price of steel stocks are likely to move up in the coming days. 
C Mahendra Exports Ltd (Rs.13) is a high risk, high gain counter. Those who have risk-appetite, should buy the stock and keep holding for some decent gains in the coming days. 
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